Glossary

A fund that invests primarily in the stocks of companies located in Asia. These funds appeal to investors who believe that Asiapotentially represents a growth area, and want to capitalize on that growth.

Ask Price

Lowest price any seller is willing to accept for a security at a given time. Also called "offer".

Also called surplus management, the task of managing funds of a financial institution to accomplish the two goals of a financial institution: (1) to earn an adequate return on funds invested and (2) to maintain a comfortable surplus of assets beyond liabilities.

Asset Allocation

The process of apportioning investments among various asset classes, such as stocks, bonds, commodities, real estate, collectibles and cash equivalents. Asset allocation affects both the risk and return of investors, and is often used as a core strategy in basic financial planning.

Asset Allocation Decision

The decision regarding how the institution's funds should be distributed among the major classes of assets in which it may invest.

Asset Allocation Fund

A fund that invests in a variety of asset classes, including domestic and foreign stocks and bonds, money market instruments, precious metals, and real estate. Some asset allocation funds maintain a relatively fixed allocation between asset classes, while others actively alter the mix as market conditions change.

Asset Class

A category of assets, such as stocks, bonds, real estate, and foreign securities.

Asset Class Breakdown

Percentage of holdings in different types of investments, ie. large stocks, international, bond, etc.

Asset Swap

An interest rate swap used to alter the cash flow characteristics of an institution's assets so as to provide a better match with its liabilities.

Asset Turnover

The ratio of net sales to total assets.

Asset-backed Security

A debt instrument collateralized by credit card receivables, auto loans, or other assets and securitized by a bank or other financial institution.

At-the-Money

An option which has a strike price that is nearest to the underlying futures price.

At-the-Opening Order

An order which specifies execution at the opening of the market or else it is canceled.

Attribute Bias

The tendency of stocks preferred by the dividend discount model to share certain equity attributes such as low price-earnings ratios, high dividends yield, high book-value ratio, or membership in a particular industry sector.

Auction Market

A market in which buyers enter competitive bids and sellers enter competitive offers simultaneously. Most stock and bond markets, including those on the NYSE, function this way.

Authorized Participant

Often called a specialist, this sophisticated professional trading firm helps create (trade stocks for an ETF) and redeem (trade an ETF for stocks) ETFs.

Automatic Exercise

The automatic exercise of an in-the-money option at expiration by the clearing firm.

Automatic Investment

A shareholder service that allows the periodic withdrawal of a specified amount from the shareholder's bank account to be invested in his or her mutual fund account. Some mutual fund groups also offer this service as a payroll deduction plan. (See also "dollar cost averaging.")

The information contained on InsideFutures.com is believed to be accurate
but is not guaranteed. Market data is furnished on an exchange delayed
basis by Barchart.com. Data transmission or omissions shall not be made
the basis for any claim, demand or cause for action. No information on
the site, nor any opinion expressed, constitutes a solicitation of the
purchase or sale of any futures or options contracts. InsideFutures.com
is not a broker, nor does it have an affiliation with any broker.